Sony Bank explores yen-pegged stablecoin

Sony Bank is exploring a stablecoin pegged to fiat currencies, including the Japanese yen, a Nikkei report has revealed.

Established in 2001, Sony Bank is the financial services arm of Sony Group Corporation (NASDAQ: SONY), the Japanese electronics, entertainment, and gaming conglomerate. With no physical branches or ATMs, it’s one of the largest banks in Japan.

The bank is working with Belgian blockchain startup SettleMint on a stablecoin.

https://twitter.com/WatanabeSota/status/1776048966054154365

As SettleMint attends to the technical side, Sony is working with regulators on the requirements of issuing a stablecoin, including its issuance, circulation, and redemption, the paper reports.

Japan has become one of the friendliest jurisdictions for stablecoins, with the government
unveiling a stablecoin law last year.

This regulatory stance has seen local companies embark on stablecoin initiatives, with Hokkoku Bank recently launching Japan’s first stablecoin backed by bank deposits.

Sony is exploring the use of the stablecoin in its vast intellectual property portfolio, which spans gaming and sports, and accepting it as a payment method for companies that use its IP rights.

With payments being closely regulated and monitored, Sony Bank intends to explore Zero-Knowledge Proof (ZKP) technology for identity verification as well as heightened KYC, AML, and anti-fraud measures to comply with financial regulations.

The announcement comes amid a rise in the prominence of stablecoins globally. Now accounting for $154 billion, they have become a key part of the digital asset ecosystem. However, a vast market gap remains to be addressed, with the top issuers facing integrity issues and ongoing lawsuits.

Additionally, some major global companies are working on stablecoins that serve specific needs in certain closed ecosystems, such as Sony’s multi-billion gaming and sports ventures.

Meanwhile, Sony continues to invest heavily in distributed ledger technology. In 2023, it partnered with Startale Labs on a public blockchain, which it hailed as “the backbone of global Web3 infrastructure.”

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